Rubber Machinery Industry Had a Turnaround

The Chinese rubber machinery industry showed an obvious declining tendency from the second half year of 2014 and hit the bottoms in the first half year of 2016 with double-digit sharp decrease of sales revenue, export delivery value and realized profit. However, the operating environment has improved since the second half year with obvious increase in product order and rate of operation. Although the sales revenue and profit index didn’t turn positive in the whole year of 2016, the decrease became obviously narrow. This indicates that the operation of the Chinese rubber machinery industry has hit the bottom, and rubber machinery enterprises can go all out to make great achievements in 2017.

Sales Revenue Fell Slightly

According to the statistics on 26 main rubber machinery enterprises in China by the Professional Rubber Machinery Committee of China Chemical Industrial Equipment Association, the sales revenue of rubber machinery in 2016 reached RMB 7.10 Billion Yuan, which decreased by 5.6% on year-on-year basis (similarly hereinafter). Based on this, it is estimated that the total sales revenue of the Chinese rubber machinery reached RMB 9.6 Billion Yuan, which decreased by 5.9%. Compared with the decrease of over 20% in 2015 and the first half year of 2016, the decrease fell obviously.

With respect to order and production, 2016 witnessed extreme contrast situations. In the first half year, there were few orders in the rubber machinery industry, which decreased by over 50%, and the rate of operation in the industry decreased to about 60%; while in the second half year, the orders formed“ a small climax” with the rate of operation in the industry exceeding 80%, and quite a number of enterprises went into full operation.

Ranked by the sales revenue, top 10 enterprises are successively MESNAC, Safe-Run, Dalian Rubber & Plastics Machinery, Yiyang Rubber Machinery, Doublestar Machinery, Huaxiang Automatic Control, Tianjin Saixiang, Guilin Rubber Machinery, China Chemical Guilin Engineering Co., Ltd. and Beijing Jingyie. The sales revenue of top ten enterprises are RMB 5.83 Billion Yuan, accounting for 60.7% of the total sales revenue, and the industrial concentration rose by 4.2%. In addition, the number of employees had an double-digital decrease, the production value of new products rose substantially and the inventory turned to decrease.

Earning Performance Turned Better

The realized profit of the enterprises included in the statistics decreased by 28.0%, which narrowed substantially compared with that of 2015 and the first half year of 2016. There were 3 enterprises running under deficit. Because of the obvious structure surplus in the industry and the low concentration, the industrial competition was fierce and the profit decreased by 200% with the sharp decrease of orders in the first half year of 2016; however, the situation of orders in the second half year turned better. But because the price of orders in the first half year was relatively low, in addition to the substantial margin of the price of steel, a main raw material, the overall profit index was unsatisfactory in the whole year. However, due to the large scale of orders in the second year of 2016, the quality of orders were relatively better, which is favorable for improving the profitability of enterprises. It is predicted that the profitability of the industry will be improved substantially in 2017.

Improvement of Internationalization

The export delivery value of 26 enterprises was RMB 1.597 Billion Yuan, which increased by 19.8%. Based on this, the total export delivery value of the Chinese rubber machinery industry in 2016 is estimated to reach USD 300 Million Yuan with an increase of 13.2%.

Ranked by the delivery export value, top 10 enterprises are successively MESNAC, Guilin Rubber Machinery, Tianjin Saixiang, China Chemical Guilin Engineering Co., Ltd., Dalian Rubber & Plastics Machinery, SINOARP, Sichuan Yaxi, Beijing Jingyie, New Universal Science and Technology and Yiyang Rubber Machinery.

The enterprise with a substantial export growth is Guilin Rubber Machinery, whose export delivery value increased by 529% and accounted for 56.24% of the total sales amount. The total export delivery value of the rubber machinery industry accounted for 20.3% of the total sales amount, which increased by 2.1% compared with last year. The growth of the export delivery value was mainly because Chinese tire enterprises establish tire plants abroad to respond to the American “ anti-dumping and countervailing” policy, creating a small climax to the demand for rubber machinery.

Nowadays, the establishment of plants abroad by Chinese tire enterprises keeps growing. According to the preliminary statistics, more than 10 tire projects are launching or planned to launch. These projects play an important driving role in the export of Chinese rubber machinery. With stable investment in the international tire market, there are many projects invested by such enterprises as Continental AG and Bridgeston, Japan, laying a good foundation for the export of Chinese rubber machinery to turn better. It is predicted that the export of Chinese rubber machinery will keep a booming tendency and the internationalization of rubber machinery will be further improved in 2017.